Should you collect customers Zip Codes?

Currently there no clear legal answer on whether you are allowed to ask customers their zip code. The typical situation is this – A customer checks out at your local retail store and in completing the sale the cashier asks the customer for their zip code. There are at least two pending lawsuits where customers have filed suit against the retailers who requested zip codes. Not only are the customers claiming that the practice is illegal, but that it violates California Song-Beverly Act of 1971, in addition to a common law right to privacy.

In response to the litigation involving the request for zip codes, Henry Perea has introduced a bill in the California Assembly known as California Business Protection Act of 2011 which clarifies the rules on collecting zip codes so that businesses that collect zip codes for legitimate purposes can function without the fear of lawsuits.

Until the law is settled, it is advisable to steer away from asking your customers their zip codes.